Dianping is a restaurant review app backed by Tencent, while Meituan is an online deals startup backed by Alibaba.
Tencent-backed Chinese restaurant review app Dianping has partnered with Alibaba-backed online deals startup Meituan to form one of China’s largest local services platforms. The partnership was announced on Thursday, although the Wall Street Journal broke the news on Wednesday. The combined entity will form one of China’s biggest online-to-offline (O2O) service providers, and could be valued at more than $15 billion. Both Dianping and Meituan will retain their brand and management structure and will operate their businesses independently.
Dianping is a restaurant review app similar to Yelp. In addition to providing consumer reviews, Dianping also offers group-buying, instant payment solutions, reservation services, take-out delivery, e-coupon promotions, and other O2O services. It has more than 200 million accumulated users. Meituan, China’s homegrown Groupon, is the country’s largest provider for local services with over 130 million annual active purchasers.
“Over the years, although the two companies were competing and had different focuses, we enjoyed the same goal of helping 10 million merchants to better serve one billion consumers in China, and in this regard, our commonalities far outweigh our differences,” said Zhang Tao, CEO of Dianping, in an official statement. Chinese search engine giant Baidu has reason to worry, as it is set to invest $3.2 billion over the next three years in Nuomi, a similar group-buying service.
This is not the first strategic partnership in China. Earlier, Alibaba and Tencent combined Didi and Kuaidi to rival Uber in ride-hailing services.
This post was originally published on e27
Featured Image Credit: Gil C/ Shutterstock